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EN/ADM/2014/Pres/14 An introduction to key concepts commonly used in the analysis of the economy by the Research Department Michael Adams 23 June 2014.

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Presentation on theme: "EN/ADM/2014/Pres/14 An introduction to key concepts commonly used in the analysis of the economy by the Research Department Michael Adams 23 June 2014."— Presentation transcript:

1 EN/ADM/2014/Pres/14 An introduction to key concepts commonly used in the analysis of the economy by the Research Department Michael Adams 23 June 2014

2 MFSM/GFS GFS SNA MFSM SNA BOP

3 Introduction Visually orientated introduction
Economists usually focus on economic growth, stability and equity Evaluating the state of the economy: Economic growth SNA 1993 Full employment (BC) Balance of payments (BoP) stability BPM5 Price and financial market stability MFSM2000 An equitable distribution of income GFSM2001 QB March 2011

4 Reason for chart Three fold
Cannot analyse economy without taking into account all four macroeconomic accounts According to the four manuals Three accounts accrual basis (SNA, BoP, MFSM) 1ST January to 31ST December One account cash-flow (GFS) ? Semi 1st April to 31ST March Adjustments between cash and accrual (challenged) Economic analysis /inter linkages in the economy across divisions Staff training and development

5 Economic analysis/interlinkages
Design of the Chart Colour coded Segments 1-38 Follow format of the Quarterly Bulletin BIG BLOCKS SNA Domestic output Gross domestic expenditure GFS General government Public corporations All institutions must fit in somewhere in the four macroeconomic accounts

6 Economic relationships
Identity relationship: GDP = GDP agriculture + GDP mining + GDP manufacturing ………… GDP Gov.Services Trade account = X mining + X agriculture + X manufacturing - M mining – M agriculture – M manufacturing Money supply = M1 + M2 +M3 Credit extension = Households + corporates G -T= Deficit Behavioural relationship: Ct = a + b.Ydt + d.interest ratet+ ɛt QB March 2011

7 Economic interpretation
QB March 2011

8 Booklet Definitions Flow of chart Use for Pre-MPC (discussion)
Various forms being used in the Department (NO1, B03, C68 and F02) Balance sheet or income statement Balance sheet – stock position Income statement – flow position Government cash-flow position 8

9 Economic chart QB March 2011

10 CONCLUSION No means exhaustive Each division use area to expand
Time series structure Overview Reasons for changes Read the Quarterly Bulletin and the economic overview of the country

11 Michael.adams@resbank.co.za Tel: +27 12 313 3874 Fax: +27 12 313 4014
Thank you Tel: Fax: QB March 2011


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